Question

If you place $1,000.00 in a savings account with an interest rate of 5.25%/month, how much should you earn in interest at the end of the month?
(1 point)
Responses

$5.25
$5.25

$52.50
$52.50

$525.00
$525.00

$0.53

Answer 1

To calculate the interest earned at the end of the month, you can use the formula for simple interest:

\[
\text{Interest} = \text{Principal} \times \text{Rate}
\]

In this case, the principal (the amount of money deposited) is $1,000.00 and the interest rate is 5.25% per month, which can be written as 0.0525 in decimal form.

Now, plug in the values:

\[
\text{Interest} = 1000 \times 0.0525 = 52.50
\]

So, the amount earned in interest at the end of the month is **$52.50**.

The correct response is:

**$52.50**